A personal budget is a document of their own particular character and where the money an individual or family group will be available for a certain period of time separating it into two large groups such as income and expenses are accounted for.
As this document becomes a roadmap for us , it will be a personal plan to help us define a better use of our money to help us get discipline in managing our budget and daily expenses.
Overall, this sheet predetermined route allows us to:
- To determine whether you need to increase our revenues
- Identify points of overspending.
- Identify areas for cost reduction
- Determine whether it will be necessary to limit the acquisition of loans.
- Create a savings account.
Income and expenses
The first step we must take to making a personal budget is the identification of our income and expenses that are unusual for us in a time period that is of our choosing (daily, weekly, monthly, etc.).
After classifying these two groups, we subdivide each in wages, investments, food, education, services, etc, quantifying how much money for wages perceive investment as we spend on services, food and others.
Make personal budget draft
Once we have estimated revenues and expenses of our home idea we should do the sketch of our budget. To start with our project, we can use any software tool, of which there are many starting excel, or just pencil and paper.
In our sketch we will place all income and expenses as well as the amounts that have projected for the following time periods that we have quantified. These projections should be based on real and attainable goals and we need to create a financial goal.
Staff development budget
Finally, once created the sketch of our budget, we will continue with our in-depth analysis of cash flow and adjusting or changing where we believe necessary. The first observation we must make is the final balance of budget and see if the difference between income and expenditure will be positive or negative.
We must ensure that this is positive and appropriate. If this is negative, we see the possibility of increasing our revenues or decrease expenses that are unnecessary. Primarily our goal should be to reduce costs, so we will have healthy finances and avoid problems in making ends meet even enough money to create our own savings.
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